Wednesday, September 9, 2015

hot pink revenue management

I do not like hot pink. So judging by the proliferation of hot pink electronics in my apartment (my kindle case, Matt's headphones, and now my phone and phone case) I can only infer that hot pink offerings are profitable not so much via higher prices due to demand for customization but for the same reason that IBM adds chips to its fast printers to slow them down and sell them at a lower price: cheapskates like me will only buy these things at low prices, and people who are willing to pay more will be put off by the color/speed.

I haven't been collating examples but anyone who carefully looks through the color options on relevant amazon* items will also have noticed that baseline colors that are certainly manufactured in greater numbers are frequently more expensive than the neon-yellow-trimmed batman-themed varieties.

Anyway, I just had to point out the reasoning behind this embarrassing device you might see me carrying around. Now back to traveling too much to blog...

*I specifically refer to amazon because they most clearly adjust their prices in response to demand without regard for silly notions like "the same good should be the same price in either color because it does the same thing and costs the same amount to make." Hmm, maybe amazon will slowly give people better intuition for the law of supply and demand...

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